Sometimes, all Wall Street wants is clarity. Even when it comes with the pain of higher interest rates.

Stocks rebounded and bonds steadied Friday after slightly warmer-than-expected inflation data caused investors to dial up bets that the Federal Reserve will lift interest rates this coming Wednesday, capping a turbulent week in which oil prices jumped above $100 a barrel, U.S. Treasury yields surged to multiyear highs and stocks showed some signs of weakness.

Behind the turnaround: Friday's inflation report was hot, but not so scorching that it dramatically shifted investors' understanding of the economy. After weeks of speculating, many were relieved to have a stronger grasp of what the Fed will do next week-and hopeful that higher rates now could reduce the risk of much more aggressive hikes down the road.

The inflation data "takes a lot of the guesswork out," said Greg Peters, co-chief investment officer at PGIM Credit. "It's just this classic case where a little more certainty is preferred versus uncertainty going into a Fed meeting."

Bonds sold off sharply earlier this week on fears about rising inflation, with the 10-year yield rising to the cusp of 5% on Thursday in its biggest one-day jump since May-defying the start of Treasury Secretary Scott Bessent's expanded debt buyback program meant to push yields lower.

Fueling inflation concerns was another jump in oil prices. Renewed threats of Houthi strikes on Saudi Arabian energy infrastructure pushed Brent crude, the international oil benchmark, near $110 a barrel Thursday night before futures settled Friday at $104.61.

The one-two punch of higher energy prices and higher yields finally seemed to catch up to the stock market, with the S&P 500 slipping 1.8% on the week through Thursday. Higher yields in particular can hurt stocks by pushing up borrowing costs across the economy and slowing growth. They can also dent the appeal of stocks by offering investors a safer way of earning a decent return.

Then came Friday's consumer-price index report. In the hours that followed, investors appeared to change their mind on just what the inflation report meant for the bond market.

First, yields jumped across maturities in a knee-jerk response to the news that core consumer prices had climbed 0.3% last month-more than what economists had predicted. Yields on Treasurys, which rise when bond prices fall, usually reflect expectations for short-term rates set by the Fed. And the CPI report seemed to confirm the consensus view that a rate increase was coming next week.

Yields on longer-term Treasurys soon started falling, though-with investors hopeful that a more hawkish Fed would move to prevent inflation getting out of control. By late afternoon, yields had reversed course again to drift higher-and ever closer to 5%.

By the end of the session, the yield on the benchmark 10-year U.S. Treasury note was 4.974%, according to Tradeweb, up from 4.943% Thursday and less than 4.8% a week earlier.

The closely watched borrowing benchmark has only topped 5% once since 2007, for just a brief period during a single trading session almost three years ago.

Elsewhere in markets, the S&P 500 gained 0.9% on Friday, while the Dow Jones Industrial Average rose about 1%, or 509 points. The Nasdaq composite also added 1%. The major indexes still all fell for the week. Brent crude nudged down 2.8%, but still rose more than 8% over the week.

Investors still face hurdles.

Some analysts warn that higher yields might crimp the gangbusters corporate earnings growth that helped send stocks to repeated records this year. Strategists at RBC Capital Markets on Friday said that they expect the Fed to raise rates three times before the end of the year after previously expecting zero hikes.

"You do expect strong earnings growth to continue, but higher rates can easily overwhelm that if things really back up," said Matt Stucky, chief portfolio manager, equities at Northwestern Mutual Wealth Management.

The geopolitical backdrop is also grim.

Wall Street has all but given up on its bet that an imminent peace deal with Iran would tamp down oil prices, with many investors increasingly bracing for an open-ended disruption to tanker traffic through the Strait of Hormuz. President Trump on Wednesday said he expected the conflict to wrap up after the November election, while White House advisers have privately warned that the conflict could drag on through the end of his term, The Wall Street Journal reported.

A key pressure-release valve for global supply is also facing new threats. After Iran-backed Houthi militants swept through Yemen in recent days to take effective control of a shipping chokepoint off the country's west coast, Saudi Arabia shut down a crucial pipeline designed to divert supplies across the Arabian Peninsula to the Red Sea. That pipeline, which had suffered multiple attacks, can carry up to seven million barrels of crude each day.

Liz Ann Sonders, chief investment strategist at Schwab Center for Financial Research, cautioned that the tailwind of earnings growth might not be as strong for stocks going forward as it has been so far this year, just because it could be difficult to maintain the recent pace. She also noted that stocks tend to underperform when the Fed is raising interest rates-particularly near the start of a series of moves.

"I think it's going to continue to be choppy," she said.